Political connections, informational asymmetry, and the efficient resolution of financial distress
(2022)
Journal Article
Aney, M. S., & Banerji, S. (2022). Political connections, informational asymmetry, and the efficient resolution of financial distress. Economic Modelling, 114, Article 105901. https://doi.org/10.1016/j.econmod.2022.105901
We show that securities issued by a distressed firm, often through exchange offers, provide the most efficient resolution of financial restructuring. Information asymmetry between the firm-bank coalition and small bondholders gives rise to other form... Read More about Political connections, informational asymmetry, and the efficient resolution of financial distress.